Ulric B. and Evelyn L. Bray Seminar in Political Economy

Alexander Hirsch, Assistant Professor of Politics and Public Affairs, Princeton University

The process of developing new policies in political organizations typically involves multiple actors who craft competing policy proposals. These actors attempt to get their preferred policies enacted by making costly investments to improve their quality. We term this process competitive entrepreneurship and its participants policy entrepreneurs, and develop a model to explore its implications for political institutions and policymaking. In particular, we analyze the interaction between dispersion of decision making authority and the number of entrepreneurs who work on developing high-quality proposals. If the status quo is very noncentrist and extremist veto players must be appeased in order to implement a new policy, then even if there are multiple potential entrepreneurs only one of them will be active. However, if the status quo is centrist or the power to choose policy is concentrated in the hands of decision makers with similar centrist preferences, two entrepreneurs will actively engage in competitive policy development. We also show that a centrist decision maker can benefit if noncentrist veto players have the right to block policy changes, and, surprisingly, this is most likely to be the case when the status quo is noncentrist.